C-Store Retailers Take Their Fight to City Hall

MINNEAPOLIS -- “This ban on the sale of menthol tobacco products is the last straw for us,” said Clay Lambert, owner of convenience store Metro Petro, during a press conference in the Minneapolis City Hall. “We would like to expand our business into other neighborhoods. However, this looming threat of banned tobacco products and the amount of revenue we would lose would make this very difficult.”

Lambert and other Minneapolis retailers recently spent a long, emotional day in City Hall fighting a proposed ordinance that would restrict the sale of menthol, mint and wintergreen-flavored tobacco products and devices to tobacco shops. If approved, the ordinance would go into effect immediately, and violations would be enforced beginning August 2018. A final vote is expected Aug. 2.

CSP Daily News followed the retailers from a press conference where they shared their side of the story with members of the media, to a more than two-hour public hearing, during which attendees spilled out into the hallway and the City Council lost quorum at the last minute, unable to vote as planned.

Photography by David Bowman

During the press conference, organized by the Coalition of Neighborhood Retailers, c-store retailers explored the economic effects of the proposed ordinance on their stores.

“We have complied with every law and mandate the city council has imposed on our business, and enough is enough,” said Madalena Morgan, director of c-store operations at Bobby & Steve’s Auto World.

“Banning the sale of this legal product will only drive these sales to a criminal and underground market and make the tobacco much more accessible to youth,” said Ahmad Al-Hawwari, an operator on the city’s north side, pictured here being interviewed by local media. “There are so many issues the City Council should be looking at and dealing with. Why are they trying to push through this ban that could devastate my sales and close a family-owned business?”

The coalition focused on two main data points:

From June 2016 to May 2017, the Minnesota Department of Human Services showed that 398 out of 405 stores checked passed their compliance check when using a decoy. That’s a 98.3% success rate.

According to 2016 data, sale of menthol tobacco products by 325 licensed stores in Minneapolis totaled $73 million. That equates to $226,000 in potential lost sales for each store in Minneapolis, according to the coalition.

Coalition members used the press conference—and subsequent public hearing—to ask the City Council to postpone the vote until more research could be conducted. It has retained third-party research firm Management Science Associates to conduct two economic studies—one focusing on the economic impact of the partial flavor ban that was passed Jan. 1, 2016. The second would explore the potential economic impact of the proposed menthol ordinance. They asked the council for 10 weeks to conduct the research.

Above: Convenience-store retailer Clay Lambert of Metro Petro is interviewed by the local media during a protest against tobacco regulation in Minneapolis.

The public hearing, held inside City Council chambers, drew more than 90 people, with others spilling into the hallway and a separate viewing room. More than 70 people signed up to testify both for and against the ordinance.

Proponents of the bill wore green tie-dyed shirts provided by the Association for Nonsmokers-Minnesota. Opponents wore red shirts from the Coalition of Neighborhood Retailers that stated “Enough is Enough.”

“I’m honestly confused at this point. I thought the point [of the ordinance] was [to curb] underage youth access,” retailer Kevin Aldwaik, pictured here, testified. “We are your first line of defense for keeping tobacco from under-agers.”

“These convenience stores are oftentimes the best enforcers of the smoking laws. And now what we’re doing is pushing it down to the street,” said another. “Don’t make decisions about us, without us.”

Proponents of the ordinance cited smoking rates among underage Minnesotans and minorities specific to menthol. Many referenced the 2016 partial ban on flavored tobacco—which at the time exempted menthol, mint and wintergreen flavors.

“We told you we would be back,” one citizen said.

One proponent of the ordinance called to industry statistics about tobacco’s contribution to in-store sales vs. gross profit dollars. At the national level, 36% of in-store sales came from tobacco last year, according to NACS data, vs. 18.2% of in-store gross profit dollars.

“Those are real numbers, and we care about them, but they are not catastrophic.”

At the beginning of the public hearing, councilperson Cam Gordon—who wrote the ordinance along with fellow councilperson Lisa Bender—acknowledged the retailers in the room.

“I’m asking our staff to do whatever we can to make sure the transition is successful for our businesses that may be impacted,” he said. For opponents in the room, that was not enough.

Two hours into the hearing, a councilperson stood up and walked out of the chambers. She had a conflicting appointment. And with that, the quorum—and its ability to vote—was lost.

Tensions flared in what was previously an emotional but civil hearing, with frustration targeted at the council.

“That was a very cowardly moment and I would say that to her face,” said one citizen. “You change your priorities to listen to your community members.”

“I really apologize to everybody that came that we lost quorum. I guess I should own part of that responsibility that I didn’t point out to everybody what a long public hearing this was certain to be, if you’ve paid attention at all,” said Gordon.

Now, all council members will be able to vote on the ordinance, slated for Aug. 2, even those who were not in the hearing.

Lambert, the final retailer to testify before quorum was lost, pushed the council to allow for further research to be done.

“You guys have got to slow this down—a lot,” he pled.

Watch CSP Daily News for the latest on Minneapolis’ imminent vote on menthol.

Since 2003 CSP magazine has ranked No. 1 in readership and market share over all other industry publications. C-store marketers have identified CSP as the preferred magazine source for their trade marketing communications. With industry-leading, highly targeted circulation to more than 100,000 subscribers, CSP reaches the key convenience retailing decision-makers fifteen times a year.